New Connecticut Law Allows Disaster Mediation Program for Property Insurance Claims

On June 21, Connecticut Governor Dannel Malloy signed into law Substitute House Bill No. 6549, Public Act No. 13-148, which allows the Connecticut State Insurance Department to set up a mediation program for insurance claims arising from a catastrophic event. The bill will allow for a program which permits policyholders to mediate property insurance claims which arise out of a catastrophic event, if the catastrophic event gives rise to a declared state of emergency.

The law follows was designed after to promote efficiencies in insurance claim resolution following Super-storm Sandy. The law follows on the backs of New York and New Jersey laws which set up mediation programs for Super-Storm Sandy victims.

The mediation program would allow property owners with property insurance to bring a claim to mediation where the amount in dispute is $5,000 or more. The insurers will be forced to bear the cost of the mediation, but will not be responsible for policyholders’ costs in hiring representatives of any kind. The lawmakers believe this law will expedite the claims resolution process when dealing with future natural disasters once the Connecticut State Insurance Department sets up the mediation program.

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